Navigation

Quick action needed to unlock loans

Finance Minister Euclid Tsakalotos conceded on Friday that differences remain between Greece and its creditors as it became clear that the government faces a mountain of work if it is to clinch rescue loans.

To secure the release of the first tranche from its new bailout, Greece must implement dozens of prior actions by the middle of next week. The Euro Working Group is to convene on Thursday and decide whether to recommend the release of 2 billion euros. If it does so, Greece should get the money in early November.

Greek officials must also prepare a second multi-bill of measures, including increases to taxes on farmers and a pension system overhaul. The second raft of measures is linked to another 1 billion euros in loans. But there are several sticking points. One is the issue of expired debts: Creditors want to make the framework stricter. The two sides are also at odds over foreclosures for main residences, as the government wants the protection level for repossessions to be at least 200,000 euros in terms of objective value (property rates used for tax purposes) while lenders want a much lower threshold.

A government decision to sack General Secretariat for Public Revenues head Katerina Savvaidou was not on the talks agenda but is said to have caused ire. European Commission spokeswoman Annika Breidthardt said officials were seeking “clarifications,” noting that Greece has pledged to improving tax collection.

Once a compromise is reached, and MPs approve a second raft of prior actions, creditors can carry out a review that could pave the way for talks on debt relief. Greek officials must also finalize the 2016 budget and a new midterm program by November 21.